Business Loan EMI Calculator
Business Loan EMI Calculator
Business Loan EMI Calculator is an online way to simplify and to make things easy by using this calculator. To calculate your business loan EMI, you can access the online EMI calculator by filling in basic loan details such as loan amount, repayment tenure and interest rates. Loan EMI is automatically calculated, as per the entered details from the applicant.
The exact EMI shall be defined by the lender at the time of loan approval. A Business Loan EMI Calculator helps borrowers plan their budgets by giving them an idea about how much EMI they would have to pay monthly-based upon the interest rate, tenure of the loan and the loan amount entered.
Also Read: Business Loan eligibility criteria in India
Table of Contents
How to Calculate EMI for Business Loan
A Business Loan Calculator is an online tool that helps you estimate your monthly EMIs for a business loan. There are three inputs required by the user:
- Loan Amount: The loan amount that you want to borrow
- Interest Rate: The interest rate being charged
- Loan Tenure: The loan tenure that you prefer (typically in months)
Once you have entered these values, the calculator will display the EMI amount that you need to pay every month, along with the total interest and principal components.
Formula for the Calculation of Business Loan
The formula to calculate Business Loan EMI:
E = P * r * (1+r)^n/{(1+r)^n – 1)}
E = EMI (Equated Monthly Instalment) amount
P = The principal loan that you want to borrow.
R = This is the rate of interest accrued every month
N = This is the tenure of the repayment (in months)
Amortization Schedule
Below in that table we have taken the example of taking a loan of ₹200,000 loan at 15% interest over 1 year, we have calculated the monthly EMI, and determined what will be interest, outstanding principal, remaining balance and principle repayment.
| Month | Opening Principal | EMI Amount | Interest Amount | Principal Amount | Closing Principal |
|---|---|---|---|---|---|
| 1 | ₹2,00,000.00 | ₹18,051.66 | ₹2,500.00 | ₹15,551.66 | ₹1,84,448.34 |
| 2 | ₹1,84,448.34 | ₹18,051.66 | ₹2,305.60 | ₹15,746.06 | ₹1,68,702.28 |
| 3 | ₹1,68,702.28 | ₹18,051.66 | ₹2,108.78 | ₹15,942.88 | ₹1,52,759.40 |
| 4 | ₹1,52,759.40 | ₹18,051.66 | ₹1,909.49 | ₹16,142.17 | ₹1,36,617.23 |
| 5 | ₹1,36,617.23 | ₹18,051.66 | ₹1,707.72 | ₹16,343.95 | ₹1,20,273.28 |
| 6 | ₹1,20,273.28 | ₹18,051.66 | ₹1,503.42 | ₹16,548.25 | ₹1,03,725.03 |
| 7 | ₹1,03,725.03 | ₹18,051.66 | ₹1,296.56 | ₹16,755.10 | ₹86,969.93 |
| 8 | ₹86,969.93 | ₹18,051.66 | ₹1,087.12 | ₹16,964.54 | ₹70,005.39 |
| 9 | ₹70,005.39 | ₹18,051.66 | ₹875.07 | ₹17,176.59 | ₹52,828.80 |
| 10 | ₹52,828.80 | ₹18,051.66 | ₹660.36 | ₹17,391.30 | ₹35,437.50 |
| 11 | ₹35,437.50 | ₹18,051.66 | ₹442.97 | ₹17,608.69 | ₹17,828.80 |
| 12 | ₹17,828.80 | ₹18,051.66 | ₹222.86 | ₹17,828.80 | ₹0.00 |
A Comparison between Different Bank Interest Rates (For unsecured business loan)
| Bank/ NBFCs | Interest Rate | Tenure | Processing Fee | Apply Now |
|---|---|---|---|---|
| SBI Bank Business Loan | 14% p.a. onwards | 1-4 years | Up to 2% of loan amount | Apply Now |
| IndusInd Bank Business Loan | 16% p.a. onwards | 1-4 years | Up to 2% of loan amount | Apply Now |
| SMFG India Credit Business Loan | 17% – 21% p.a. onwards | 1-4 years | Up to 2% of loan amount | Apply Now |
| Bank of Baroda Business Loan | 17% p.a. onwards | 1-4 years | Up to 2% of loan amount | Apply Now |
| HDFC Business Loan | 14% – 18% p.a. | 1-4 years | Up to 2% of loan amount | Apply Now |
| ICICI Bank Business Loan | 16% – 18% p.a. | 1-4 years | Up to 2% of loan amount | Apply Now |
| Axis Bank Business Loan | 15% – 18% p.a. | 1-4 years | Up to 2% of loan amount | Apply Now |
| Standard Chartered Bank Business Loan | 15% p.a. onwards | 1-4 years | Up to 2% of loan amount | Apply Now |
| Deutsche Bank Business Loan | 16% p.a. onwards | 1-4 years | Up to 2% of loan amount | Apply Now |
| Kotak Mahindra Bank Business Loan | 15% p.a. onwards | 1-4 years | Up to 2% of loan amount | Apply Now |
| RBL Bank Business Loan | 15% p.a. onwards | 1-4 years | Up to 2% of loan amount | Apply Now |
| IDFC First Bank Business Loan | 15% p.a. onwards | 1-4 years | Up to 2% of loan amount | Apply Now |
| Aditya Birla Finance Ltd Business Loan | 17%-18% p.a. onwards | 1-4 years | Up to 2% of loan amount | Apply Now |
| Yes Bank Business Loan | 16% p.a. onwards | 1-4 years | Up to 2% of loan amount | Apply Now |
| Tata Capital Business Loan | 16% p.a. onwards | 1-4 years | Up to 2% of loan amount | Apply Now |
| Hero Fincorp Ltd Business Loan | 16% p.a. onwards | 1-4 years | Up to 2% of loan amount | Apply Now |
| Bajaj Finserv Business Loan | 16% p.a. onwards | 1-4 years | Up to 2% of loan amount | Apply Now |
| NeoGrowth Business Loan | 16% p.a. onwards | 1-4 years | Up to 2% of loan amount | Apply Now |
| U Gro Business Loan | 16% p.a. onwards | 1-4 years | Up to 2% of loan amount | Apply Now |
Benefits of using the EMI Calculator
Some of the key benefits of using the EMI Calculator are as follows:
- Estimation: It allows applicants to calculate the estimated EMI amount payable for their business loans based on various loan amounts, tenures, and interest rates.
- Efficiency: Using a Business Loan EMI Calculator saves time spent manually calculating the EMI amount. Furthermore, calculating the business loan EMI manually requires a complex formula, which can result in calculation errors.
- Financial Planning: Knowing the exact loan EMI amount helps borrowers plan their finances and repayment. Business owners must have financial insight, and the online calculator helps significantly with this.
Flexibility: Business loan EMI calculators allow the user to select multiple combinations of tenure, interest rate, and loan amount, assisting the prospective applicant in determining the best tenure and EMI for their repayment capacity.
Factors that Affect Business Loan EMI
- Loan Amount: The amount that you are going to borrow decides your EMI amount. When the amount is higher, the EMI is high and when the amount is low, the EMI too remains low. However, it may depend on some other factors too.
- Rate of Interest: One of the crucial factors in deciding the loan EMIs and shall be chosen after thoroughly comparing the loan options offered by various lenders. The lender sets your business loan interest rate after considering your credit scores, income, repayment capacity, occupation profile, etc. Higher interest rates will lead to higher EMI and vice versa.
- Compare Lenders Online: Before applying for a business loan, Compare with top lenders. Borrowers should compare interest rates, loan terms, and other fees to ensure they are getting the best deal at a competitive interest rate. The lower the interest rate, the lower the EMI on the business loan.
- Repayment Tenure: Another factor that plays an important role in determining the Loan EMI is Repayment Tenure. A longer tenure ensures lesser EMI, while a shorter tenure ensures a high amount of EMI.
- Consider Part-Prepayment: Many lenders now allow you to partially prepay your business loan after making regular EMI payments for 6-12 months. Borrowers can use this facility to make additional lump sum payments while still paying their monthly EMIs. The lump-sum payment can significantly reduce the loan amount, resulting in lower EMIs.
Disclaimer
The calculator provided is for representational purposes only. Results may vary on many factors, including the assumptions you provide. We do not guarantee their accuracy or applicability to circumstances. The calculator is intended to provide you with an estimate of your monthly payments and is not certified or endorsed by OneNDF.
The calculator is provided by assistance only and is not intended to be and must not alone be taken as the basis for an investment decision. The user assumes the entire risk of any use made of this information.
OneNDF shall not be responsible or held liable for any errors or discrepancies in the results, resulting from the usage of the calculator, use of the calculator is solely at your own risk.
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FAQs
What is a Business Loan EMI Calculator?
A Business Loan EMI Calculator helps you to predetermine the amount payable at the end of every month. It will help you opt for a loan amount that matches the plans of your business and plan your cash resources accordingly.
How does a Business Loan EMI Calculator work?
A Business Loan EMI Calculator tells you the approximate amount you will have to pay as EMI on the loan amount you wish to take for your desired tenure. It also gives you the total interest amount that will be due on the loan, as well as the total payable amount. This information helps you in planning your repayment more easily to accommodate your current and future income and expenditures.
How to calculate EMI using Business Loan EMI Calculator?
A Business Loan EMI Calculator is simple to use. All you need to do is enter the loan amount, rate of interest and the tenure (in months) to calculate your business loan EMI.
Can I use the EMI calculator for any type of business loan?
Yes, the Business Loan EMI Calculator can be used for any type of business loan. You may calculate your monthly payments by entering the loan amount, interest rate and tenure.
What is an EMI of Rs 10 Lakh Business Loan?
The EMI for Rs 10 lakh business loan can vary depending on the interest rate and the loan tenure:
15% interest rate for 4 years – The EMI for a Rs 10 lakh personal loan at 15% interest rate for 4 years is approximately Rs 27,831.
13% interest rate for 1 year – The EMI for a Rs 10 lakh personal loan at 13% interest rate for 1 year is approximately Rs 89,317.
What are the eligibility criteria for a Business Loan?
- Age: 21 years at the time of loan application and 65 years at the time of loan maturity (it may vary across lenders)
- Minimum Business Vintage: 3 years (There maybe some lenders who can consider up to 2 years of business vintage as well).
- Minimum Business Turnover: Rs 90,000 to more than Rs 250 crore.
- Credit Score: 750 or above
- Minimum Income: Rs 1 lakh p.a.
- Eligible Entities: MSMEs, Proprietors, Limited Liability Partnership firms, Private Limited Companies, Public Limited Companies, Self-employed individuals or professionals, individual corporations, etc.
What is the interest rate of a business loan?
The business loan interest rates offered by banks and non-banking financial companies (NBFCs) usually start from 9% p.a. However, the final interest rates offered by the lender depends on their net interest margins, cost of funds and internal risk assessment of their loan applicant’s credit profile.
What is the typical tenure of a business loan?
The typical/usual tenure for a business loan depends on the type of loan and nature of the business, but it usually ranges from 12 months to 5 years.
What is the difference between a secured and unsecured business loan?
Secured loans require some sort of collateral such as a car, a home or any other valuable asset, that the lender can seize if the borrower defaults on the loan, whereas, Unsecured loans require no collateral but do require that the borrower be sufficiently creditworthy in the lender’s eyes.
Can I prepay a business loan before the tenure ends?
Many Business Loans allow early closure, which may come with prepayment penalties or fees. These may vary by financial institution and loan agreement, so reviewing the terms before deciding to pay off a loan before its tenure ends is essential.
What are the common uses for a business loan?
Business Loans are used for a variety of purposes that include, Inventory Finance, Business Expansion, Debt Consolidation, Working Capital, Cash Flow Issues, Office Space Renovation, etc.
How long does Business Loan approval take?
The time it takes to approve a business loan can vary depending on several factors, such as the lender’s internal processes, verification process or if additional documents are required from the borrower. Generally, the approval process for a business loan can take anywhere from a few days to a few weeks.
